Euribor fell to record low of 0.255% in February, a decline of 14 per cent in a month, and 54 per cent in a year, reducing monthly mortgage payments for borrowers in Spain.
As a result of the latest fall in Euribor (12 months) a typical €200,000 loan with 25 years to run will pay €30 per month less, or €360 less p.a.
New Mortgage Lending Up For First Time Since Crash Began
The number of new mortgage loans increased by 1.6 per cent in 2014 compared to the previous year to reach 202,954, the first increase after seven years of falls, according to data from the Spanish Statistical Institute (INE in Spanish). This might mean that Spanish mortgage lending has finally bottomed out.
Since 2007, new mortgages have been falling, mostly by two digits. Specifically, in 2013 they decreased by 27.1 per cent, while in 2012, 2011 and 2008 they dropped by more than 32 per cent. In 2009, they decreased by 22.2 per cent while the falls in 2010 and 2007 were more moderate – 6.6 and 7.7 per cent respectively.
The average mortgage loan value rose 2.1 per cent in 2014, to €102,130, meaning that the overall value of new mortgage lending rose 3.8 per cent last year, to €20,727 million.
New Mortgage Lending By Region
By autonomous region, the ones that registered the higher number of mortgages in 2014 were Andalusia (36,860), Madrid (35,461) and Catalonia (30,261). Seven regions saw year-on-year negative rates, mainly La Rioja (-16.6 per cent) and Aragón (-14.3 per cent), and in ten, more mortgages were signed than in 2013 with the most significant increases in Extremadura (+20.5 per cent) and Navarra (+17.3 per cent).
New Mortgage Lending in December 2014
The number of mortgages made in December was 15,962, up 28.9 per cent compared to the same month in 2013. This is the first time in five years that both the number and value of new residential mortgages has increased in December.
Mortgage lending has now increased for seven consecutive months on an annualised basis.
At the end of 2014, the average interest rate residential mortgages was 3.5 per cent, compared to 4.21 per cent a year ago.
93.6 per cent of mortgages in December used a variable interest rate with 6.4 per cent using a fixed rate. Euribor is the most used reference for variable interest mortgages, used in 88.9 per cent of new contracts.
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